How Much Car Insurance Do I Need Under the New Michigan No-Fault Law?
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Michigan’s No-Fault law is complicated, especially with so many coverage choices. Since July 1, 2020, drivers choose a Personal Injury Protection (PIP) medical level. They also choose residual liability limits and, usually, uninsured and underinsured motorist coverage.
Our car accident lawyers cannot replace your insurance agent, but we can explain how those choices affect a claim. Here is a guide to the main options.
Do You Have a Case?PERSONAL INJURY PROTECTION (PIP) COVERAGE OPTIONS
PIP still includes work loss, replacement services and survivor’s benefits, subject to the statute. Since July 1, 2020, you choose how much PIP medical you want. There are six medical options:
Option 1 — Unlimited PIP medical (the old default)
Pays allowable medical and related expenses for care, recovery and rehabilitation, including many items ordinary health insurance does not cover, with no dollar cap.
Option 2 — $500,000 PIP medical
Up to $500,000 per injured person per accident for medical and related expenses.
Option 3 — $250,000 PIP medical
Up to $250,000 per person per accident.
Option 4 — $250,000 PIP medical with exclusions
You may exclude yourself, a spouse or a resident relative from PIP medical if that person has other qualified health coverage (not Medicare or Medicaid) that covers auto-accident injuries. Excluded people have no PIP medical on this auto policy.
Option 5 — $50,000 PIP medical (Medicaid households)
Available only if the named insured is on Medicaid, and the spouse and resident relatives have qualified coverage for auto injuries (Medicaid, other health insurance or another auto policy with PIP medical).
Option 6 — No PIP medical
Available only if the named insured has Medicare Parts A and B, and the spouse and resident relatives have qualified health coverage for auto injuries (including another auto policy with PIP medical).
HOW DO I DECIDE HOW MUCH CAR INSURANCE I NEED?
There is no one-size-fits-all Michigan No-Fault policy. Weigh each option against your household’s health coverage and what a catastrophic injury would cost.
Unlimited PIP medical is the most complete. Premiums are usually higher.
Limited PIP medical stops when the cap is reached. Other health insurance may pick up some bills after that, but not the full PIP list (attendant care, many modifications, wage loss).
Opting out of PIP medical (Medicare or other qualified plans) usually lowers the premium. Medicare and typical health plans do not match unlimited PIP.
HOW MUCH LIABILITY (BODILY INJURY) COVERAGE DO I NEED?
Liability pays others if you injure or kill someone. Since July 1, 2020, the minimum is $50,000 per person and $100,000 per accident. Many renewal bills default to $250,000 / $500,000. You may choose more or less, but not below $50,000 / $100,000.
Buy as much residual liability as you can reasonably afford. Ask about an umbrella policy for extra liability.
HOW MUCH UNINSURED AND UNDERINSURED MOTORIST COVERAGE DO I NEED?
UM/UIM helps if the at-fault driver has no insurance or too little liability coverage. It is optional but important when someone else’s limits cannot cover a serious injury. Buy as much as you can comfortably afford.
WHY DOES MY BILL SHOW UNLIMITED PIP AND $250,000/$500,000 LIABILITY?
Insurers often print default amounts on renewals. If you want a different PIP medical or liability level, you must tell the agent and complete the required forms.
CONTACT AN EXPERIENCED CAR ACCIDENT ATTORNEY TODAY
If you or a loved one is injured in an accident, we can help you understand the coverage you have and the claims you may bring.
Michigan No-Fault law is complicated, but finding the right auto accident attorney is simple.
Start your case by filling out the brief form below or contact us for a free, no-obligation consultation.
Do You Have a Case?
